Zhejiang Huatong Meat Products Co.Ltd(002840)
Annual report for 2021
April 2022
Section I important tips, contents and definitions
The board of directors, the board of supervisors and the directors, supervisors and senior managers of the company guarantee that the contents of the annual report are true, accurate and complete without false records, misleading statements or major omissions, and bear individual and joint legal liabilities.
Zhu Jianjun, the person in charge of the company, Zhang Kaijun, the person in charge of accounting, and WAN Xueqin, the person in charge of the accounting organization (Accounting Supervisor), declare that they guarantee the authenticity, accuracy and completeness of the financial report in this annual report.
All directors have personally attended the meeting of the board of directors to consider this annual report.
Any content in this report involving future plans, performance forecasts and other aspects does not constitute the company’s commitment to any investors and related persons. Investors and related persons should maintain sufficient risk awareness and understand the differences between plans, forecasts and commitments. The company shall comply with the disclosure requirements of livestock and poultry aquaculture industry in the guidelines for self discipline supervision of listed companies of Shenzhen Stock Exchange No. 3 – industry information disclosure.
(I) food safety risk: food is the most important thing for the people and food safety is the first. Food safety is related to people’s health and life safety. China has always attached great importance to food safety. The food safety law (revised in 2021) has further strengthened the main responsibility of food producers and operators, strengthened the supervision and management of food safety and the accountability of food safety violations. Food quality and safety control has become the top priority of food processing enterprises. If there are mistakes in the company’s quality management or food safety accidents due to unexpected reasons in the future, the company’s brand and reputation will suffer heavy losses. The company’s main business income is mainly food (including fresh pork, fresh poultry and deeply processed meat products). If the company’s reputation is damaged due to food safety accidents, which will affect the sales of all kinds of food, it will have a great impact on the company’s operation and lead to the risk of sharp decline in operating profit.
(II) the risk of animal disease and the health and safety of livestock and poultry resources are very important to the development of the company. The epidemic situation of livestock and poultry can be transmitted through contact, food, air and other ways. The infection area is wide and the prevention is difficult. Taking pig breeding as an example, the major diseases occurring in the process of pig breeding in China are pig blue ear disease, foot-and-mouth disease, porcine epidemic diarrhea, porcine pseudorabies, porcine circovirus and African swine fever. In recent years, major animal diseases such as highly pathogenic avian influenza, highly pathogenic pig blue ear disease, type a foot-and-mouth disease and African swine fever have occurred in some parts of China, which has had a great impact on China’s livestock and poultry breeding industry. On the one hand, the outbreak of large-scale animal diseases will reduce the slaughter volume of livestock and poultry, which will have an adverse impact on the company’s raw material supply and its own livestock and poultry breeding business; On the other hand, the epidemic is easy to cause people’s panic about the consumption of pig and poultry products, or urge consumers to increase the consumption of alternative products (such as beef, mutton, etc.), or directly lead to the shrinkage of the consumption demand of pig and poultry products. At present, the company’s business covers two industrial chains of pig and poultry breeding, slaughtering and processing. The main business income is mainly livestock and poultry meat or related products. In the future, if a large-scale animal disease occurs, or the implementation of the company’s disease prevention and control system is not effective, the company will face the risk of rising livestock and poultry death costs and declining production and sales, resulting in a sharp decline in performance. In this regard, the company has formulated a strict biosafety and epidemic prevention system, continuously improved the construction of biosafety system, and prevented the occurrence of epidemic diseases from all aspects, such as material procurement, feed processing, transportation vehicles, personnel access, decontamination / transit setting, personnel training, hardware investment, detection means and so on.
(III) risk of price fluctuation of raw materials. Pigs and live poultry are the main raw materials for slaughtering, while wheat, corn, secondary flour and soybean meal are the main raw materials for pig and live poultry breeding. China’s livestock and poultry prices fluctuate periodically due to the influence of feed prices, market supply and demand, large-scale breeding level, animal epidemic and agricultural policies. On the one hand, there is a certain time lag between the change of meat sales price and the change of livestock and poultry purchase price. When the livestock and poultry purchase price continues to rise, if the company cannot adjust the product sales price in time, it will have an adverse impact on the company’s business performance; On the other hand, the rise in the sales price of livestock and poultry products urges consumers to increase the consumption of alternative products (such as beef, mutton, etc.), and the decline of market demand will lead to the decline of the company’s performance. As the company’s new pig breeding projects are put into operation, the company’s demand for main raw materials such as wheat, corn, secondary flour and soybean meal will gradually rise. It is expected that the fluctuation of bulk Shenzhen Agricultural Products Group Co.Ltd(000061) price in the future will have a great impact on the company’s main business cost and net profit. In this regard, the company continues to pay close attention to the supply and demand trend of feed raw materials, improve the prediction ability of raw material market, continuously optimize feed formula technology, control feed costs, and improve the management system of upstream suppliers. At the same time, it does not rule out the use of futures hedging tools to reduce the impact of raw material price fluctuations on the company.
(IV) risk of changes in preferential tax policies. According to the Provisional Regulations of the people’s Republic of China on value added tax, the company’s self-produced Shenzhen Agricultural Products Group Co.Ltd(000061) sales of livestock and poultry can be exempted from value-added tax; According to the notice on the exemption of feed products from value-added tax (CS [2001] No. 121) issued by the Ministry of Finance and the State Administration of Taxation, the company engaged in the sales of feed products can be exempted from value-added tax; According to the notice of the Ministry of Finance and the State Administration of Taxation on the policy of exemption from value-added tax on the circulation of some fresh meat and egg products (CS [2012] No. 75), some fresh meat and egg products sold by companies engaged in Shenzhen Agricultural Products Group Co.Ltd(000061) wholesale and retail are exempted from value-added tax. According to the enterprise income tax law of the people’s Republic of China and the regulations for the implementation of the enterprise income tax law of the people’s Republic of China, the company’s income from raising livestock and poultry is exempted from enterprise income tax; According to the notice of the Ministry of Finance and the State Administration of Taxation on Issuing the scope of Shenzhen Agricultural Products Group Co.Ltd(000061) primary processing (for Trial Implementation) enjoying the preferential policies of enterprise income tax (CS [2008] No. 149), the announcement of the State Administration of Taxation on the implementation of preferential policies of enterprise income tax for agricultural, forestry, animal husbandry and fishery projects (Announcement No. 48 of the State Administration of Taxation in 2011) and the Ministry of finance According to the supplementary notice on the scope of Shenzhen Agricultural Products Group Co.Ltd(000061) primary processing with preferential corporate income tax (CS [2011] No. 26) issued by the State Administration of Taxation, the company’s income from Shenzhen Agricultural Products Group Co.Ltd(000061) primary processing is exempted from corporate income tax. If the state reduces the tax preference of Shenzhen Agricultural Products Group Co.Ltd(000061) and Shenzhen Agricultural Products Group Co.Ltd(000061) primary processing enterprises, it will have a great adverse impact on the operating performance of the company.
(V) risk of price fluctuation of live pigs. The cyclical fluctuation of market price of commercial pigs will lead to the cyclical fluctuation of gross profit margin of pig breeding industry. With the company’s new pig breeding projects put into operation one after another, if the “pig cycle” enters the trough period, the pig market price continues to be depressed, and the company can not effectively control the breeding cost, the company has the risk of decline in the company’s operating performance due to the adverse impact of pig breeding business. In this regard, the company mainly deals with the risk of pig price fluctuation by strengthening procurement management, optimizing feed formula, improving production efficiency and breeding technology and other measures to reduce production costs; On the other hand, the company will continue to improve the integrated business model of pig industrial chain and reduce the adverse impact of pig price fluctuation on the company’s business performance through different links of the industrial chain.
The company plans not to distribute cash dividends, bonus shares or increase share capital with provident fund.
catalogue
Section I important tips, contents and definitions Section 2 company profile and main financial indicators Section III Management Discussion and Analysis Section IV corporate governance Section V environmental and social responsibility 71 section VI important matters Section VII changes in shares and shareholders 106 Section VIII preferred shares 115 section IX relevant information of bonds 116 section x financial report one hundred and twenty
Directory of documents for future reference
1、 The financial statements containing the signatures and seals of the legal representative, the financial principal and the person in charge of the accounting institution of the company. 2、 The original of the audit report with the seal of the accounting firm and the signature and seal of the certified public accountant. 3、 Originals of all company documents and announcements publicly disclosed in newspapers designated by the CSRC during the reporting period. 4、 The place where the above documents for future reference are prepared: the investment and Securities Department of the company.
interpretation
Explanatory item refers to the explanatory content
The company, the company, the issuer, Zhejiang Huatong Meat Products Co.Ltd(002840) refers to Zhejiang Huatong Meat Products Co.Ltd(002840)
Lvfa agriculture refers to Yiwu lvfa Agricultural Development Co., Ltd. – a wholly-owned subsidiary of the company
Haoqiang agriculture and animal husbandry refers to Jinhua Haoqiang agriculture and animal husbandry Co., Ltd. – a wholly-owned subsidiary of the company
Xianju poultry industry refers to Xianju Huanong poultry industry Co., Ltd., a wholly-owned subsidiary of the company
Zhengkang poultry industry refers to Zhengkang (Yiwu) poultry industry Co., Ltd., a wholly-owned subsidiary of the company
Quzhou animal husbandry refers to Quzhou Huatong animal husbandry Co., Ltd. – a wholly-owned subsidiary of the company
Tiantai animal husbandry refers to Tiantai Huatong animal husbandry Co., Ltd., a wholly-owned subsidiary of the company
Huanong slaughtering refers to Yiwu Huanong poultry slaughtering Co., Ltd. – a wholly-owned subsidiary of the company
Huzhou Huatong refers to Huzhou Nanxun Huatong meat products Co., Ltd., a wholly-owned subsidiary of the company
Xianju Guangxin refers to Xianju Guangxin Food Co., Ltd., a wholly-owned subsidiary of the company
Tiantai Huatong refers to Tiantai Huatong Food Co., Ltd., a wholly-owned subsidiary of the company
Lanxi Linong refers to Lanxi Linong Food Co., Ltd., a wholly-owned subsidiary of the company
Shenxian Huatong refers to Shenxian Huatong Food Co., Ltd. – a wholly-owned subsidiary of the company
Lishu Huatong refers to Lishu Huatong Food Co., Ltd., a wholly-owned subsidiary of the company
Shaoyang Huatong refers to Shaoyang Huatong Food Co., Ltd., a wholly-owned subsidiary of the company
Tonglu Huatong refers to Tonglu Huatong Food Co., Ltd., a wholly-owned subsidiary of the company
Lvfa agricultural machinery refers to Zhejiang lvfa agricultural and Animal Husbandry Machinery Co., Ltd., a wholly-owned subsidiary of the company
Huatong trading refers to Zhejiang Huatong Food Trading Co., Ltd. – a wholly-owned subsidiary of the company
Hangzhou trade refers to Hangzhou Huatong Food Trade Co., Ltd. – a wholly-owned subsidiary of the company
Lanxi trading refers to Lanxi Huatong Food Trading Co., Ltd., a wholly-owned subsidiary of the company
Green hair feed refers to Zhejiang green hair feed Technology Co., Ltd. – a wholly-owned subsidiary of the company
Xianju feed refers to Xianju lvfa Feed Co., Ltd., a wholly-owned subsidiary of the company
Lanxi feed refers to Lanxi lvfa Feed Co., Ltd., a wholly-owned subsidiary of the company
Huasheng feed refers to Zhejiang Huasheng feed Technology Co., Ltd., a wholly-owned subsidiary of the company
Jixi animal husbandry refers to Jixi Huatong animal husbandry Co., Ltd., a wholly-owned subsidiary of the company
Pujiang animal husbandry refers to Pujiang Huatong animal husbandry Co., Ltd. – a wholly-owned subsidiary of the company (changed from a holding subsidiary to a wholly-owned subsidiary during the reporting period)
Lishui agriculture and animal husbandry refers to Lishui Linang ecological agriculture and animal husbandry Co., Ltd. – a holding subsidiary of the company (changed from a holding subsidiary to a wholly-owned subsidiary after the reporting period)
Dongyang animal husbandry refers to Dongyang Huatong animal husbandry Co., Ltd. – a holding subsidiary of the company (changed from a holding subsidiary to a wholly-owned subsidiary after the reporting period)
Lishui feed refers to Lishui Lvshengyuan Feed Co., Ltd. – a holding subsidiary of the company (changed from a holding subsidiary to a wholly-owned subsidiary after the reporting period)
Lanxi animal husbandry refers to Lanxi Huatong animal husbandry Co., Ltd. – a holding subsidiary of the company
Xianju green hair
